AerCap Holdings N.V. (NYSE:AER)

Having a leading position in the aviation industry, AerCap Holdings NV is an integrated aviation company, with a portfolio of over 300 aircraft and 57 engines either owned, on order, under contract or letter of intent, or managed, providing aircraft and engine leasing, trading and parts sales. Through its certified repair stations, it provides aircraft management services, performs aircraft and engine maintenance, repair and overhaul and aircraft disassemblies.

Lack of new supply and lack of availability of used quality aircraft for sale has tightened the supply of commercial aircrafts, which has ultimately favored suppliers like AerCap. The global demand for aircrafts, engines and other related services are driven by economic growth, globalization and entry of low cost carriers. The worldwide growth in air travel is expected to continue, whereby the size of the fleets is expected to double by almost 2025.

In April 2006, the company completed the acquisition of AeroTurbine, which specializes in aftermarket commercial aircraft engines and parts sales. AeroTurbine has established a large commercial engine leasing portfolio through its aggressive growth, and is well on its way to becoming the largest independent provider of aftermarket engine and airframe materials support. Being a high margin business, AeroTurbine’s expertise with engines and airframe parts would complement AerCap’s aircraft leasing and management expertise.

AerCap continues to enjoy good relationship with Airbus, as it is one of the largest Airbus‘s customers, which finally helps the company to qualify for favored pricing status. Also it has good exposure to the Chinese market due to its joint venture with China Aviation. Thus, AerCap should influence investors positively in the coming year.